New York: India-born fallen Wall Street titan Rajat Gupta should be ordered to reimburse to Goldman Sachs USD 6.90 million of legal fees incurred in his insider trading case, the investment bank has said, telling a court here that it is "entitled" to the amount.

The US government has also written to the District Court in the Southern District of New York to grant Goldman's request to be reimbursed by its former director Gupta the amount it paid in legal fees and related costs in connection with the investigation of his insider trading case.

In a motion filed in court, Goldman said it has been a "victim" of 64-year-old Gupta's criminal conduct and violation of his duties as the firm's director.

"As a result of Gupta's conduct, Goldman Sachs has incurred nearly seven million dollars in external legal fees and costs in conducting an internal investigation, in responding to numerous government requests in parallel criminal and civil investigations and proceedings, and in attending to other resulting legal matters," the investment banking giant said in court papers.

"Goldman Sachs is entitled to... and now seeks reimbursement of those legal fees and related costs that were a direct and foreseeable result of Gupta's offence," it said.

"The Court should award Goldman Sachs 6.90 million dollars in restitution for legal fees and related costs."

Manhattan's federal prosecutor Preet Bharara, on behalf of the government, said in a separate filing to the court that "the government respectfully submits that Goldman, as the 'victim' of Gupta's crimes, is entitled to recover all attorney fees" that were incurred by the investment bank due to Gupta's offences.

Goldman filed its motion in court in reply to Gupta's submission a week ago that he should not be required to pay the legal fees and other expenses to Goldman since the fees is for work that was not necessarily incurred during "participation in the investigation or prosecution" of his insider trading case.

Gupta is appealing his conviction on insider trading charges and earlier this month was granted his appeal to stay out of prison on bail pending appeal.

The former McKinsey head was slapped a USD five million fine and sentenced to two years' imprisonment.

Goldman said it had engaged the services of a law firm in 2009 after it was brought to its notice that Gupta had allegedly provided confidential company information to hedge fund founder Raj Rajaratnam.

Over the next three years, the law firm provided services to Goldman, including conducting fact-finding regarding Gupta's conduct, representing Goldman and its directors, officers and employees in responding to criminal and regulatory enforcement investigations and the resulting prosecutions of Gupta and Rajaratnam. "Goldman Sachs faced significant legal demands in connection with these matters," it said.

Goldman added that it incurred expenses and required legal assistance in responding to approximately 27 grand jury subpoenas and document requests from the US Attorney's Office and the Securities and Exchange Commission (SEC), responding to six subpoenas from Gupta himself, collecting and reviewing millions of documents, and producing over 400,000 pages of material in over 100 separate document productions.

The law firm also represented Goldman Chairman and CEO Lloyd Blankfein in preparation for and testimony at Gupta's trial in June this year.

Goldman said Gupta is wrong in seeking to avoid payment for the various categories of expenses. He is "erroneous" in claiming that Goldman is not entitled to recover the legal fees because they were not incurred during "participation in the investigation or prosecution" of Gupta.

Gupta also argues that Goldman is not entitled to restitution for legal fees arising from the parallel SEC investigation.

Goldman responded that the SEC and criminal investigations and proceedings by the US government "were closely related and coordinated."

Goldman also rejects Gupta's claims that he should not be asked to pay legal fees for the insider trading charges on which he was acquitted.

"Gupta's conviction for conspiracy directly implicates him as a co-conspirator, making him liable to pay restitution even on uncharged or acquitted counts," Goldman said.

Gupta has refused to pay costs incurred by Goldman in assisting in the government's investigation and prosecution of his role in insider trading of Procter & Gamble securities.

He further said Goldman cannot charge him for proceedings that took place after his trial ended in June to which Goldman said the "post-verdict proceedings, including work related to seeking restitution and responding to SEC depositions noticed by Gupta, were a direct and foreseeable result of Gupta's offence."

Significantly, Goldman Sachs does not seek as restitution the more than USD 35 million in legal defence fees and costs that it has advanced to Gupta, as required by its by-laws, pursuant to his undertaking to repay those fees and costs if it is ultimately determined that he was not entitled to indemnification.

Goldman Sachs intends to recoup those costs upon any final determination of Gupta's lack of entitlement to indemnification, and not as part of this proceeding.

Gupta had said last week in court papers that Goldman has submitted 540 pages of billing records for a three-year period from December 2009 through November 2012 which do not contain specifics of the legal tasks performed by Goldman in connection with Gupta's case.

Goldman said the records are voluminous because Gupta's decision to contest the charges against him required the firm to interview and assist in preparing numerous potential witnesses for trial testimony and incur costs from attending the trial itself.

"While it was unquestionably Gupta's right to contest the charges against him, his decision to do so imposed significant costs upon Goldman Sachs which the firm has the right to recover," Goldman added.